Asymmetric Effects of Corruption on CO2 Emissions in Pakistan: The Role of Human Capital and Foreign Direct Investment
DOI:
https://doi.org/10.47067/real.v7i4.373Keywords:
Corruption, Human Capital, Gross Domestic Product (GDP) , CO2 Emissions, NARDL, PakistanAbstract
This study aims to examine the relationship between corruption, human capital, FDI, GDP and CO2 emissions in Pakistan from 1996 to 2022. This study utilized the NARDL approach to estimate the asymmetric association. The empirical findings revealed that corruption in positive shocks enhances CO2 emissions while, in negative shocks, it mitigates CO2 emissions. Human capital and FDI played beneficial roles in decreasing CO2 emissions. On the other hand, GDP exacerbated CO2.The results highlight the importance of stringent accountability measures to stop more environmental damage. The study recommends that to effectively tackle both corruption and environmental challenges, there is a crucial need to invest in human capital. Strengthening human capital can help enhance accountability, reduce corruption, and promote sustainable environmental practices.
References
Abdul-Mumuni, A., Amoh, J. K., & Mensah, B. D. (2023). Does foreign direct investment asymmetrically influence carbon emissions in sub-Saharan Africa? Evidence from nonlinear panel ARDL approach. Environmental Science and Pollution Research, 30(5), 11861-11872.
Abid, L., Kacem, S., &Saadaoui, H. (2023). The impacts of economic growth, corruption, energy consumption and trade openness upon CO2 emissions: West African countries case. Arab Gulf Journal of Scientific Research.
Asif, K., Sabir, S., &Qayyum, U. (2023). Corruption, Political Instability, and Environmental Degradation in South Asia: a Comparative Analysis of Carbon Footprint and Ecological Footprint. Journal of the Knowledge Economy, 1-25.
Bernauer, T., Koubi, V., 2009. Effects of political institutions on air quality. Ecol. Econ. 68, 1355–1365.
Boamah, V., Tang, D., Zhang, Q., & Zhang, J. (2023). Do FDI Inflows into African Countries Impact Their CO2 Emission Levels?. Sustainability, 15(4), 3131.
Çamkaya, S., Karaaslan, A., &Uçan, F. (2023). Investigation of the effect of human capital on environmental pollution: empirical evidence from Turkey. Environmental Science and Pollution Research, 30(9), 23925-23937.
Chen, Y., &Raza, K. (2023). Asymmetric impact of technological innovation, foreign direct investment and agricultural production on environmental degradation: evidence from Pakistan. Environmental Science and Pollution Research, 30(36), 85237-85248.
Faheem, M., Farooq, F., Nousheen, A., & Bashir, F. (2023). Examining the Impact of Fiscal Decentralization and Renewable Energy on CO2 Emissions: Insights from Pakistan. iRASD Journal of Economics, 5(4), 984-1001.
Faheem, M., Farooq, F., Nousheen, A., &Waheed, A. (2024). Green Growth and Financial Development: A Path to Environmental Sustainability in Pakistan. Journal of Accounting and Finance in Emerging Economies, 10(1), 13-22.
Faheem, M., Nousheen, A., Farooq, F., &Anwer, M. A. (2023). Bridging the Gap: Financial Inclusion's Role in Environmental Sustainability in Pakistan. Journal of Accounting and Finance in Emerging Economies, 9(3), 369-382.
Fallon PR, Layard PRG (1975) Capital-skill complementarity, income distribution, and output accounting. Journal of political economy 83(2):279–302.
Farooq, F., Faheem, M., &Nousheen, A. (2023). Economic policy uncertainty, renewable energy consumption and environmental sustainability in China. Pakistan Journal of Humanities and Social Sciences, 11(2), 1926-1938.
Farooq, F., Faheem, M., &Nousheen, A. (2023). Renewable energy consumption, natural resource, urbanization and environmental sustainability in Pakistan. Pakistan Journal of Commerce and Social Sciences (PJCSS), 17(3), 588-617.
Georgescu, I., &Kinnunen, J. (2023). The role of foreign direct investments, urbanization, productivity, and energy consumption in Finland’s carbon emissions: an ARDL approach. Environmental Science and Pollution Research, 30(37), 87685-87694.
Ghorbal, S., & Ben Youssef, S. (2023). Scrutinizing the role of renewable energy and patents in pollution abatement and economic growth in South Korea. Energy & Environment, 0958305X231164685.
Gnangoin, T. Y., Kassi, D. F., &Kongrong, O. (2023). Urbanization and CO2 emissions in Belt and Road Initiative economies: analyzing the mitigating effect of human capital in Asian countries. Environmental Science and Pollution Research, 30(17), 50376-50391.
Goel, R.K., Herrala, R., Mazhar, U., 2013. Institutional quality and environmental pollution: MENA countries versus the rest of the world. Econ. Syst. 37, 508–521.
Habib, S., Abdelmonen, S., & Khaled, M. (2020). The effect of corruption on the environmental quality in African countries: a panel quantile regression analysis. Journal of the Knowledge Economy, 11(2), 788-804.
Hwang, Y., Kim, C. B., & Yu, C. (2023). The Effect of Corruption on Environmental Quality: Evidence from a Panel of CIS Countries. Journal of the Knowledge Economy, 1-20.
Isiksal, A. Z., Assi, A. F., Zhakanov, A., Rakhmetullina, S. Z., &Joof, F. (2022). Natural resources, human capital, and CO2 emissions: Missing evidence from the Central Asian States. Environmental Science and Pollution Research, 29(51), 77333-77343.
Jahanger, A. (2022). Impact of globalization on CO2 emissions based on EKC hypothesis in developing world: the moderating role of human capital. Environmental Science and Pollution Research, 29(14), 20731-20751.
Jahanger, A., Yang, B., Huang, W. C., Murshed, M., Usman, M., &Radulescu, M. (2023). Dynamic linkages between globalization, human capital, and carbon dioxide emissions: empirical evidence from developing economies. Environment, development and sustainability, 25(9), 9307-9335.
Khan, M., Rana, A. T., &Ghardallou, W. (2023). FDI and CO2 emissions in developing countries: the role of human capital. Natural Hazards, 117(1), 1125-1155.
Klitgaard, R., 1988. Controlling Corruption. University of California Press, Berkeley. Koyuncu, C., Yilmaz, R., 2009. The impact of corruption on deforestation: a cross-country evidence. J. Dev. Areas 42 (2), 213–222.
Kuznets S (1955) International differences in capital formation and financing. In Capital formation and economic growth. Princeton University Press, pp 19–111
Li, X., &Ullah, S. (2022). Caring for the environment: how CO2 emissions respond to human capital in BRICS economies?. Environmental Science and Pollution Research, 29(12), 18036-18046.
Luo, Y., Guo, C., Ali, A., & Zhang, J. (2022). A dynamic analysis of the impact of FDI, on economic growth and carbon emission, evidence from China, India and Singapore. Environmental Science and Pollution Research, 29(54), 82256-82270.
Lv, Z., &Gao, Z. (2021). The effect of corruption on environmental performance: does spatial dependence play a role?. Economic Systems, 45(2), 100773.
Mahmood, H., Saqib, N., Adow, A. H., & Abbas, M. (2023). FDI, exports, imports, and consumption-based CO2 emissions in the MENA region: spatial analysis. Environmental Science and Pollution Research, 30(25), 67634-67646.
Mahmood, N., Wang, Z., & Hassan, S. T. (2019). Renewable energy, economic growth, human capital, and CO 2 emission: an empirical analysis. Environmental Science and Pollution Research, 26, 20619-20630.
Mehmood, U. (2022). Renewable energy and foreign direct investment: does the governance matter for CO2 emissions? Application of CS-ARDL. Environmental Science and Pollution Research, 29(13), 19816-19822.
Pazienza, P. (2019). The impact of FDI in the OECD manufacturing sector on CO2 emission: Evidence and policy issues. Environmental Impact Assessment Review, 77, 60-68.
Pei, Y., Zhu, Y., & Wang, N. (2021). How do corruption and energy efficiency affect the carbon emission performance of China’s industrial sectors?. Environmental Science and Pollution Research, 28, 31403-31420.
Rahman, M. M., &Alam, K. (2022). Effects of corruption, technological innovation, globalisation, and renewable energy on carbon emissions in asian countries. Utilities Policy, 79, 101448.
Rehman, F. U., Nasir, M., &Kanwal, F. (2012). Nexus between corruption and regional Environmental Kuznets Curve: the case of South Asian countries. Environment, development and sustainability, 14, 827-841.
Romer, P. M. (1990). Endogenous technological change. Journal of political Economy, 98(5, Part 2), S71-S102
Romilly P, Song H, Liu X (2001) Car ownershipand use in Britain: a comparison of the empirical results of alternative cointegration estimation methods and forecasts. Applied economics 33(14):1803–1818
Shakoor, A., Ahmed, R., Ahmed, Z., & Khan, U. (2023). Impact of subsectors of agriculture and economic growth on CO2 emissions in Pakistan: evidence from Environmental Kuznets Curve. Environmental Science and Pollution Research, 30(10), 25728-25739.
Shin Y, Yu B, Greenwood-Nimmo M (2014) Modelling asymmetric cointegration and dynamic multipliers in a nonlinear ARDL framework. Festschrift in honor of Peter Schmidt. Springer, New York, NY, pp 281–314
Sinha, A., Gupta, M., Shahbaz, M., &Sengupta, T. (2019). Impact of corruption in public sector on environmental quality: Implications for sustainability in BRICS and next 11 countries. Journal of Cleaner Production, 232, 1379-1393.
Umair, M., Yousuf, M. U., Ul-Haq, J., Hussain, Z., & Visas, H. (2023). Revisiting the environmental impact of renewable energy, non-renewable energy, remittances, and economic growth: CO2 emissions versus ecological footprint for top remittance-receiving countries. Environmental Science and Pollution Research, 30(23), 63565-63579.
Wang, Z., Zhang, B., & Wang, B. (2018). The moderating role of corruption between economic growth and CO2 emissions: evidence from BRICS economies. Energy, 148, 506-513.
Wei, Y., Ji, L., Faheem, M., &Nousheen, A. (2024). Dynamic role of energy utilization, financial development, and information technology on environmental sustainability? Evidence by the tragedy of the commons theory. Energy & Environment, 0958305X241265343.